The northern suburbs of Johannesburg have been exceptionally popular among both property buyers and tenants in recent years due to the amenities, schools and access to business nodes and transport routes the suburbs in this region offer.
This is according to Sheree Peach, residential rentals manager at Renprop, who says on the rental side of the property market, demand for secure properties in the northern Johannesburg suburbs continues unabated. The rental market is buoyant, with demand for well-priced, appointed and managed apartments continuing to increase, despite the current flat economy and trading conditions.
Peach says while initially the demand for rental properties was underpinned by the lack of 100% home loans being approved for buyers, especially first-time buyers, now it seems that a shortage of stock available for purchase is influencing the market.
“We are finding that buyers, especially young professionals, are waiting for the construction of new developments to catch up with demand. In the interim, these buyers are looking for rental properties to occupy while they wait to buy a new sectional title property off-plan.”
She says many potential buyers are also renting while they are saving up for a deposit, or waiting until they earn enough to qualify for the home loan amount they require.
The ongoing demand and limited supply of rental stock is pushing the average rental prices up, with the average rental price for properties within the northern Johannesburg region ranging between R6 000 and R10 000 per month, depending on the area and accommodation offering of the property.
This one bedroom apartment in Bryanston, Sandton, offers an open-plan kitchen and lounge. It is renting for R6 200 per month - click here to view.Peach says while there is demand for a wide range of apartments, one bedroom, one bathroom and two bedroom, two bathroom units in secure complexes tend to be the most sought-after rental properties in the northern suburbs of Johannesburg.
“The majority of potential tenants we are interacting with are looking for properties to rent in the Bryanston, Ferndale and Rivonia areas, with the most sought-after monthly rental price range sitting between R6 000 and R8 500,” she says.
Peach says another ongoing trend on the rental side of the market is that more and more investors, especially those who have a number of rental units in their portfolio, are starting to move away from self-managed portfolios and are engaging in managed mandates instead.
“No investor wants to put their income stream at risk by signing a lease with a potentially unreliable tenant, or one who cannot afford to pay the rent.”
She says it has become quite a challenge to determine the quality of the tenant, and the credit check process is even more complicated now than it has been in the past.
“While many buy-to-let investors in sought-after areas are reaping the benefits of strong demand, it is prudent to ensure that a buy-to-let property is well managed to attract the right calibre of tenants and to protect the investment,” says Peach.
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